A Fairy Tale Gone Wrong: Spain's Princess Accused Of Fraud

Inaki Urdangarin, the husband of Spain's Princess Infanta Cristina, is accused of embezzling millions of dollars. The princess is scheduled to appear in court Saturday to face allegations of tax fraud.

Spain's King Juan Carlos looks on during a ceremony at the royal palace in Madrid on Jan. 6. The royal family has come under increasing criticism for its spending habits as Spain has endured an economic crisis.

Gerard JulienAFP/Getty Images

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Originally published on February 10, 2014 11:35 am

It seemed like a fairy-tale romance. The Spanish king's youngest daughter, Infanta Cristina, went to the 1996 Summer Games in Atlanta and fell in love with a handsome Spanish aristocrat-turned-Olympian, Iñaki Urdangarin. A year later, King Juan Carlos walked his daughter down the aisle.

Through marriage, Urdangarin got a royal title — the Duke of Palma — and carried his bride over the threshold of an $8 million mansion in Barcelona.

But the fairy tale has since unraveled.

"I think if you came back home, as Iñaki must have done, and said, 'Darling, we've just bought this $8 million house in Barcelona,' you presumably would ask your husband, 'Well, can we afford it?' " said William Chislett, a British author and researcher at the Elcano Royal Institute in Madrid. "And I would assume that Infanta either didn't ask, didn't want to ask — or simply assumed that they had the money."

They apparently didn't, or, as prosecutors claim, it wasn't their money.

Urdangarin had sought to parlay his Olympic success (two bronze medals in handball) into a career running a nonprofit foundation that organized sports events and conventions. But he stands accused of embezzling $8 million through that work.

The couple's Barcelona mansion has been confiscated by Spanish authorities, in lieu of bail money for Urdangarin.

And this Saturday, the princess is scheduled to appear in court on allegations of tax fraud and money-laundering tied to her alleged involvement in her husband's business.

It's the first time a Spanish royal has ever been named a suspect in a criminal case. She and her husband face up to six years in prison if charged and convicted.

Their troubles imperil the Spanish royal family at a sensitive time — amid economic crisis, a pesky push by the northeast region of Catalonia to secede from Spain, and the 76-year-old king's ailing health.

The royals' approval ratings have hit their lowest level since democracy took hold here in the late 1970s.

"Things have changed very noticeably. The Spanish royals are not in the same position as the British monarchy yet — in that they're considered fair game in the media, for satire and criticism," said Hugh O'Donnell, a Scot who wrote a book on the Spanish royal family, the Borbóns. "But they're moving in that direction, where at last it's actually OK to criticize them if people think what they're doing isn't right."

A recent comedy sketch on a popular Spanish TV show, Polónia, shows a fairy godmother — a man dressed in drag — waving a magic wand and transforming Urdangarin into a rat, and Princess Cristina into a pauper — then erasing her from royal family photos. The studio audience goes wild.

"I remember when it would have been really unthinkable to publish a cartoon in Spain that ridiculed the monarchy in any way," said O'Donnell. "But now what we're witnessing is a kind of withering away of deference."

Infanta Cristina is the only direct descendant of a Spanish king to be subpoenaed in a criminal case, in modern history. Only King Juan Carlos himself has immunity from prosecution.

Even so, the king has not escaped criticism in the court of public opinion. He was forced to issue a rare royal apology in 2012, after it came out that he had taken an elephant-hunting trip to Africa that cost several times the annual average salary of a Spaniard.

When his daughter appears in court this weekend, judges plan to grill her on what role, if any, she played in her husband's business. Prosecutors allege the duke embezzled public donations through shell companies, at least one of which was partially owned by the princess.

"The central question is her participation in a company called Aizoon, which [tax documents show] was 50 percent owned by the princess herself," said Carlos Cruzado, a Spanish tax inspector studying the princess' case. "With that ownership comes responsibility for any crimes the company may have committed."

This week, the royal palace faced more austerity. The king — like all Spanish civil servants — has had his salary frozen for a third straight year. His daughter, Princess Cristina, has been cut out of the budget completely.

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

MELISSA BLOCK, HOST:

This weekend, a Spanish princess will appear in court. She faces allegations of tax fraud and money laundering. It's the first time a Spanish royal has ever been named a suspect in a criminal case. From Madrid, Lauren Frayer reports this is the latest in a series of scandals that have dropped the Spanish royal family's approval rating to an all-time low.

LAUREN FRAYER, BYLINE: It seemed like a fairy tale romance. The Spanish king's youngest daughter, Infanta Cristina, went to the '96 summer games in Atlanta and fell in love with a handsome Spanish Olympian, Inaki Urdangarin. A year later, the king walked his daughter down the aisle. Urdangarin got a royal title - the Duke of Palma - and carried his bride over the threshold of their $8 million dollar home in Barcelona. The couple had four beautiful children. But the fairy tale soon unraveled.

WILLIAM CHISLETT: I think if you came back home, as Inaki must have done, and said, darling, we've just bought this 6 million euro house in Barcelona, you presumably would ask your husband, well, can we afford it, you know? And I would assume that Infanta either didn't ask, didn't want to ask, or simply assumed that they had the money.

FRAYER: William Chislett is a British author and researcher at the Elcano Royal Institute in Madrid. He says the princess' husband, Urdangarin, is now accused of embezzling $8 million dollars from a sports foundation he ran. Their luxury home was seized. The princess left Spain for a job in Geneva. As for her handsome duke, Chislett says...

CHISLETT: He is persona non grata in the royal palace. I mean, I think actually that's pretty much official. They would not want to be photographed with him. I'm not quite sure what's going to happen to the Infanta. She can hardly be airbrushed out of photographs.

FRAYER: Though that's the exact plot line of a recent comedy sketch on Spanish TV.

(SOUNDBITE OF TV SHOW, "POLONIA")

UNIDENTIFIED MAN: (Singing in foreign language)

FRAYER: On the Spanish satirical show "Polonia," a fairy godmother drag queen waves a magic wand and turns Urdangarin into a rat and Cristina into a pauper, and then airbrushes the princess out of royal family photos. Such satire was unheard of in Spain until recently, says Hugh O'Donnell, a Scot who wrote a book about the Spanish royals.

HUGH O'DONNELL: I mean, I remember when it would have been really unthinkable to publish a cartoon in Spain that kind of ridiculed the monarchy in any way. So as that deference fades away, figures in the monarchy become much more obvious targets for criticism, for satire.

FRAYER: And for prosecution, from which only the king has immunity. The princess appears in court this weekend. Judges plan to grill her on what role she played in her husband's business. Prosecutors allege the duke embezzled money through shell companies, at least one of which was partially owned by the princess, says Carlos Cruzado, head of the Spanish tax inspectors' union.

CARLOS CRUZADO: (Through Translator) The central question is her participation in a company called Aizoon, which tax documents show was 50 percent owned by the princess herself. With that ownership comes responsibility for any of the crimes the company may have committed.

FRAYER: If charged, the princess and her husband could face up to six years in prison. All this imperils the Spanish royal family at a time of national crisis over the economy and the 76-year-old king's ailing health. This week, the Royal Palace took another pay cut. The king, like all Spanish civil servants, has had his salary frozen for a third straight year. His daughter, Princess Cristina, has been cut from the budget altogether. For NPR News, I'm Lauren Frayer in Madrid. Transcript provided by NPR, Copyright NPR.